TechnipFMC’s shares slid on July 25, a day after the oil services company said it had overstated its first-quarter net income by $209.5 million.
The company said late on July 24 that the overstatement stemmed from accounting errors related to its auditing of foreign exchange movements after examining the matter with its management and PricewaterhouseCoopers.
TechnipFMC’s accounting error added to negative sentiment hitting the oil services sector, with Italian rival Saipem—controlled by oil major Eni—also issuing a profit warning on July 25.
TechnipFMC shares were down by about 4% in New York and in Paris, where the company has a secondary stock market listing, while Saipem shares were down 1.5%.
Oil service companies have been struggling to fill order books as oil majors defer projects and cut billions of dollars in costs to offset low crude prices.
“We are steering clear of these stocks for now, due to the tough market conditions facing them,” said Keren Finance fund manager Benoit de Broissia.